Japanese Market Recovers After Weak Start

5/9/2012 10:49 PM ET

After a weak start, the Japanese stock market pared most of its losses on Thursday before losing some ground again with investors mostly treading a cautious path amid lingering concerns about the global economy. However, with a few front line stocks inching higher on strong support, the market is currently trading just below the unchanged line.

On the economic front, Japan saw a current account surplus of 1.589 trillion yen in March, the Ministry of Finance said Thursday. That beat forecasts for a surplus of 1.449 trillion yen after showing a surplus of 1.177 trillion yen in February.

The trade balance came in with a surplus of 4.2 billion yen, also beating expectations for a deficit of 42.8 billion yen after the surplus of 102.1 billion yen in the previous month.

The adjusted current account showed a surplus of 785.5 billion yen, well above forecasts for a surplus of 650.0 billion yen after coming in at 854.1 billion yen a month earlier. For the fiscal year 2011, the current account surplus was 7.893 trillion yen - down from 16.659 trillion yen in FY 2010.

Meanwhile, bank lending in Japan was up 0.4 percent on year in April at 397.08 trillion yen, the Bank of Japan said. That follows the 0.9 percent annual expansion in March.

Including trusts, bank lending was up 0.3 percent to 459.30 trillion yen after rising 0.8 percent on year in the previous month. Loans from foreign banks plummeted 22.7 percent on year to 2.224 trillion yen after plunging an annual 26.7 percent a year earlier.

In the currency market, the U.S. dollar traded in the upper 79 yen range in early deals in Tokyo. The yen is currently trading at 79.65 to the dollar.

Among other markets in the Asia-Pacific region, Australia, New Zealand and Taiwan are trading modestly higher. Shanghai, Hong Kong and Malaysia are up marginally, while Singapore and South Korea are trading weak. Markets across the region ended notably lower on Wednesday.

On Wall Street, stocks ended notably lower on Wednesday despite staging a fairly strong comeback from the day's lows. Once again, uncertainty about the political situation in Europe weighed on the markets.

The Dow ended down 97 points or 0.8 percent at 12,853.1 and the Nasdaq drifted down 11.6 points or 0.4 percent to 2,934.7, while the S&P 500 slid 9.1 points or 0.7 percent to 1,354.6.

Major European markets turned in a mixed performance on Wednesday. While the German DAX index moved up by 0.5 percent, the French CAC 40 index and the U.K.'s FTSE 100 index lost 0.2 percent and 0.4 percent, respectively.

U.S. crude oil futures drifted lower for a sixth straight day on Wednesday with a strong dollar and concerns about eurozone economy contributing to the slide. Crude for June delivery dropped $0.20 or 0.2 percent to close at $96.81 a barrel on the New York Mercantile Exchange.